The UK Consumer Prices Index slowed to 4.5% in October from 5.2% the previous month
The Consumer Prices Index (CPI) - the Government's official benchmark of the cost of living - slowed to 4.5% in October from 5.2% the previous month.
The 0.7% fall - much bigger than economists expected - is the biggest monthly drop since April 1992, says the Office for National Statistics (ONS).
As crude oil prices plummeted from their record highs in mid-July, the average price of a litre of petrol fell 7.1p to 104.5p in the month to October.
At the same time diesel dropped 7p to an average of 116.3p a litre.
Urgent action is now needed to get oil, gas and electricity prices back down to where they were last spring.
Although CPI is still more than double the Bank of England's 2% target, the huge fall has stoked fears of deflation - negative inflation - next year.
The October figure reflects falling meat and housing prices as well as lower fuel costs.
With oil and the cost of raw materials still tumbling more big falls in inflation are expected in the months ahead.
The prospect of deflation was flagged up last week by Bank of England governor Mervyn King who said it was "very likely".
It makes further cuts in the base rate of interest - currently at a 53-year low of 3% - even more likely.